Debate House Prices


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Land Reg April +0.8% MoM

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Comments

  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    The thing that will turn the housing market into a functioning entity again is when renting becomes more expensive than owning, especially at a long-term interest rate that is viable. With nominal rents rising at about 2-3%pa and nominal house prices falling very slowly it is just a matter of time.
  • adr0ck
    adr0ck Posts: 2,374 Forumite
    Part of the Furniture Combo Breaker
    Batchy wrote: »
    If anything with cars, they have significantly increased in value, so it doesnt help really, along with fuel price increases. I think everyone should start buying mopeds.

    But what is the substitute for housing... house of mom and dad? it hasnt got much legs in it.

    caravans

    a lot more people will be living in caravans in the future
  • chucky
    chucky Posts: 15,170 Forumite
    10,000 Posts Combo Breaker
    Generali wrote: »
    The thing that will turn the housing market into a functioning entity again is when renting becomes more expensive than owning, especially at a long-term interest rate that is viable. With nominal rents rising at about 2-3%pa and nominal house prices falling very slowly it is just a matter of time.
    people will then argue that there is no money and people are struggling to make ends meet so wouldn't buy and house prices have to come down.
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    chucky wrote: »
    people will then argue that there is no money and people are struggling to make ends meet so wouldn't buy and house prices have to come down.

    We'll see soon enough. Much of the US (I mean the bits that people actually want to live in) will hit that point before too long if the latest house price figures from there are to be believed. Perhaps another year or 2.
  • Batchy
    Batchy Posts: 1,632 Forumite
    adr0ck wrote: »
    caravans

    a lot more people will be living in caravans in the future

    Never, ... ive had a static caravan to live in, its not cheap it depreciates worse than a car, and they cost a lot to maintain/move. plus for 2 months of the year you have to get out (normally). Otherwise you have to pay full council tax, etc, etc. I also had a flat at the same time, as I would never have lived in the caravan.

    DAMP, COLD, SPACE, NOISE... DID I MENTION FLOODS?

    Smaller caravans are a substitue for expensive holidays.

    Temporarily housing maybe, but not a long term substitute. Not even in the same ball park.
    Plan
    1) Get most competitive Lifetime Mortgage (Done)
    2) Make healthy savings, spend wisely (Doing)
    3) Ensure healthy pension fund - (Doing)
    4) Ensure house is nice, suitable, safe, and located - (Done)
    5) Keep everyone happy, healthy and entertained (Done, Doing, Going to do)
  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Generali wrote: »
    The thing that will turn the housing market into a functioning entity again is when renting becomes more expensive than owning, especially at a long-term interest rate that is viable.

    That's already the case in 80% of the UK, even with mortgage rates of 5% instead of todays 3.4% average.

    I don't dispute that rising yields will eventually attract capital into the housing market. That's inevitable. But it may not be the type of capital that benefits potential FTB-s....
    With nominal rents rising at about 2-3%pa and nominal house prices falling very slowly it is just a matter of time.

    The latest LSL data has nominal rents rising at 4.4% pa and now at an all time high. I imagine ONS data is lower, but conducted based on surveys blending existing as well as new rentals, so should time lag in that regard.
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”

    -- President John F. Kennedy”
  • Generali
    Generali Posts: 36,411 Forumite
    10,000 Posts Combo Breaker
    That's already the case in 80% of the UK, even with mortgage rates of 5% instead of todays 3.4% average.

    I don't dispute that rising yields will eventually attract capital into the housing market. That's inevitable. But it may not be the type of capital that benefits potential FTB-s..

    The latest LSL data has nominal rents rising at 4.4% pa and now at an all time high. I imagine ONS data is lower, but conducted based on surveys blending existing as well as new rentals, so should time lag in that regard.

    ONS is based on the Household Spending Survey so reflects what their sample actually spends. I don't know enough about how LSL source their figures to know if they are better. They seem to produce the best HPI series these days.

    One way or another, rising rents will get people buying. As you say, who will buy remains to be seen.
  • HAMISH_MCTAVISH
    HAMISH_MCTAVISH Posts: 28,592 Forumite
    Part of the Furniture 10,000 Posts Name Dropper Photogenic
    Generali wrote: »
    ONS is based on the Household Spending Survey so reflects what their sample actually spends. I don't know enough about how LSL source their figures to know if they are better. They seem to produce the best HPI series these days.

    Yes, it's my understanding that the LSL data consists solely of new lettings and renewals of private sector tenancies.

    ONS data includes council houses and existing tenancies in their survey, so by definition should have a less rapid rate of change.

    So if you want to know how much private sector rents are increasing each year, LSL is the better indicator.

    For wider economic queries such as the percentage of total income spent on housing by the whole population at any given time, ONS is the better indicator.
    One way or another, rising rents will get people buying. As you say, who will buy remains to be seen.

    Indeed.

    That capital will be drawn into the market is inevitable. Whether that capital benefits FTB-s or Landlords..... Well, we'll know soon enough, certainly before the next election.;)
    “The great enemy of the truth is very often not the lie – deliberate, contrived, and dishonest – but the myth, persistent, persuasive, and unrealistic.

    Belief in myths allows the comfort of opinion without the discomfort of thought.”

    -- President John F. Kennedy”
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